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USD/CAD Tests Major Support

The Canadian dollar surged after its labour market’s strong performance in December. Renewed selling pressure has driven the pair below the swing low at 1.3470 from the start of the year, which suggests a lack of support. The daily level and December’s low of 1.3390 is a critical floor and its breach could lead to a bearish reversal below 1.3300. As the RSI inches to the oversold area, the demand zone may trigger a ‘buy-the-dips’ behaviour. 1.3560 would be the first hurdle should the greenback manage to bounce back.

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